Please assist with the given problem.
Cost of a bond: His broker quoted a price of $1,180. Jim is concerned that the bond might be overpriced based on the facts involved.
The $1,000 par value bond pays 14 percent interest, and it has 25 years remaining until maturity. The current yield to maturity on similar bonds is 12 percent. Compute the new price of the bond and comment on whether you think it is overpriced in the marketplace.